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Apple plans 3,600 new jobs for Austin

Apple plans 3,600 new jobs for Austin

Apple Inc. is proposing to more than double its operations in Austin over the next 10 years, creating as many as 3,600 jobs in what it is calling its Americas Operations Center.

The proposal was announced Friday by Gov. Rick Perry, who said the State of Texas has offered Apple $21 million in incentives over 10 years from the Texas Enterprise Fund to win the deal.

Apple's final decision on the deal is waiting on a contract from the state and approval of incentives by the City of Austin and Travis County. The city has proposed incentives of up to $8.6 million.

City officials said the company is considering another expansion site in Phoenix and won't make a final decision until the Texas offer is completed and approved.

The project, which would be built in two phases, calls for Apple to spend $304 million on land, buildings and equipment for a 38-acre campus at West Parmer Lane and Delcour Drive in Northwest Austin. That proposed campus is close to Apple's current campus on Riata Vista Circle.

Apple has operated a customer support center in Austin for the past two decades, and it has grown to about 3,500 employees as Apple's business has expanded.

Bolstered by tremendous growth in sales of smart mobile devices, Apple is considered the most profitable company in information technology. It reported a profit of $25.9 billion on sales of $108.2 billion for the fiscal year that ended Sept. 24.

The company was guarded in what it said about the Austin expansion project.

"We're looking forward to building a new campus in Austin, which will more than double the size of our workforce there over the next decade," Apple said in a statement. "Our operations in Austin have grown dramatically over the past decade, from less than 1,000 employees in 2004 to more than 3,500 today."

The city estimates that Apple would create between 650 and 3,635 full-time jobs if it builds its Americas Operations Center here. It estimates the average annual wages paid for new Apple workers in Austin would be $63,950. About 93 percent of the jobs are expected to be filled with local hires, the city said.

The types of new jobs would include expanded sales, customer support and accounting functions for Apple's business in North and South America, the governor's office said.

The city is proposing to give Apple an economic development grant of $8.6 million based on a 10-year waiver of real and personal property taxes on the new development.

The City Council is expected to conduct a special meeting on the agreement Thursday and vote on approving the deal March 22.

Apple is proposing to build the campus in two phases, according to city documents. The first phase, which would be completed before the end of 2015, would include about 200,000 square feet of building space. The second, larger phase would include up to 800,000 additional square feet of space.

"The expansion of their Austin facility adds to the growing list of visionary high-tech companies that have found that Texas' economic climate is a perfect fit for their future, thanks to our low taxes, reasonable and predictable regulations, fair legal system and skilled workforce," Perry said in a statement.

Austin Mayor Lee Leffingwell said he is "thrilled that Apple has decided to more than double their workforce here in Austin through economic development agreements with the city, county and state."

"This is a great deal for our citizens, as this will be another cash positive agreement for the City of Austin. Apple has been part of our community for many years and we are proud to welcome their Americas Operations Center, which will have thousands of good jobs available and will grow our economy even more," Leffingwell said in a written statement.

Travis County Judge Sam Biscoe did not provide an estimate of the county's incentives offer to Apple but said it will be "substantial."

Biscoe said he expects the county's offer "will be significantly less than the city's" and said he expects the Travis County Commissioners Court will vote on the deal shortly after the Austin City Council votes.

"Where we have a good partner who wants to expand here and where we have a history with them, we want to be cooperative," Biscoe said. "I want to tell taxpayers that we have a capital investment that is substantial, new jobs created and more tax revenue created" than is rebated to the company.

"Apple represents the most appropriate type of tech company that we should be attracting to Austin," said economist Angelos Angelou, who headed the Greater Austin Chamber of Commerce recruiting team that brought the company's first operations here in the early 1990s. "The fact that they are expanding their presence here is validation that Austin has done quite well by Apple. This is an employer that we worked very hard to bring to Austin 20 years ago, and it is great to see them choose Austin for such a significant expansion."

Apple, which is building a new headquarters complex in Cupertino, Calif., needs to expand outside California as well to support its fast-growing global business, said analyst Roger Kay with Endpoint Technologies Associates.

"Apple is on fire," Kay said. "They are doing incredibly well. They are putting a lot of operations in a lot of places, and they have a lot of money and a lot of growth they need to manage."